Shulou(Shulou.com)06/02 Report--

Recently, Oracle began to slash its China R & D Center (CDC). A total of 1600 people will be laid off in CDC, and nearly 60% of its employees will be laid off. What is the reason why Oracle China has made such a big move to lay off staff?

In fiscal 2018, Oracle's total revenue was $39.831 billion, up 6% from $37.728 billion in the previous fiscal year, while net profit was $3.825 billion, down 59% from $9.395 billion in the previous fiscal year. Although the revenue of the Chinese market is not disclosed, the revenue of the Asia-Pacific region is 6.333 billion yuan, accounting for only 16% of the total revenue.

In the era of cloud computing, oracle has been left behind by its competitors. Cloud computing market share has sadly fallen into the other camp, the impact is almost negligible.

Before the era of cloud computing. Each enterprise needs to set up its own server cluster and install all kinds of basic services. Therefore, there are high requirements for hardware and software with high performance and high stability. Also willing to pay a high price. Oracle has also made huge profits. But in the era of cloud computing. It turns out that Oracle's important customers, major Internet companies, have basically implemented IOE (IBM minicomputers, Oracle databases, EMC storage devices). In this way, Oracle undoubtedly lost a lot of revenue.

To make matters worse, these IOE-based Internet companies not only abandoned Oracle's products. Instead, it has become a cloud service provider and entered the enterprise market to compete with Oracle. Now, traditional companies, if they want to build their own IT facilities, do not need to buy infrastructure separately, such as servers, operating systems and databases. Instead, cloud services can be purchased directly from cloud service providers. It turns out that corporate customers are willing to buy Oracle products. Because Oracle's products represent stable, flexible and high-quality service. But in the era of cloud computing, none of these things are a problem. For cloud computing, stability is guaranteed by a large cluster of hosts. System resilience is a natural attribute of cloud services. At any time, performance, bandwidth, space is not enough, add money at any time, expand at any time.

In such a market environment, Oracle is attacked on both sides. Traditional market share is shrinking, and there is no significant improvement in the emerging cloud services market. Substantial layoffs are inevitable.

Oracle's market share in China is gradually shrinking, which is also related to the development of domestic software. Enterprise software such as Kingdee user Friends Wave has done very well, and the wave has also established a joint venture with Odoo, the world's largest open source ERP vendor, to form PS Cloud.

TOP10 ranking of major vendors in China's enterprise application software market in 2018

According to the 2018-2019 Chinese Enterprise Application Software Market Annual report (Management Software report) released by CCID, Oracle's overall market share in China fell to the third place and was surpassed by the tide. At present, the market share of Chinese enterprise application software is ranked as user, SAP, Tide, Oracle and Kingdee. Oracle is not brilliant in the Chinese market, and layoffs are just one of its manifestations.

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